South Africa: Already Ready for a Reunion

The clamor for a Chazen South Africa reunion began minutes after the official trip ended. “I’m having separation anxiety already you guys,” wailed one particularly emotive person into our GroupMe chat while still boarding the flight from Johannesburg back to John F. Kennedy airport. In the last few days, even as we returned to our routines in New York, birthday parties have been co-opted into reunions, trips to South African wine bars planned, and much love and longing expressed for each other.

Personally, this was one of the best trips I went on, and I made many friends I don’t think I otherwise would have made at Columbia Business School. The magic of South Africa has surely something to do with it.

IMG_3059.jpgFor starters, many of us were compelled by South Africa’s history. The most soulful moments of the tour came when we understood more about the history of apartheid—either on Robben Island, home to so many political prisoners including Nelson Mandela, or at the Apartheid Museum in Johannesburg. We had much to reflect—for instance, how apartheid started off as a solution to urbanization (certainly not the common way societies deal with that trend), and also how Mandela and the ANC’s resistance was mostly peaceful (certainly not the common way the oppressed resist throughout history).

Yet perhaps that sense of peace has ensured that South Africa’s economy is today nowhere near as ravaged as, say, Zimbabwe. It’s grown to become one of the BRICS emerging markets. As this blog detailed earlier this month, Chazen saw many interesting businesses and met many striving entrepreneurs. We couldn’t help but remark to each other how such economic energy has arisen from the ashes of apartheid.

Along the way, South Africa’s biodiversity brought us closer. There are some things in life we can’t share without becoming good friends with each other—and the majesty of an African elephant brushing past our jeep during a Kruger Park game drive, the cuteness overload of watching a penguin waddling on a beach by the Cape of Good Hope, or the exhaustion after having climbed the 1,000 meters up Table Mountain to arrive at the best views of Cape Town surely count among them.

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Lastly, this trip was successful because of our organizers: Thando Mtshali ’18, Divya Raj ’18 and Maria Sebastian ’18, who worked under the aegis of the Chazen Institute. The three perfectly understood when to hold our hands through Johannesburg’s bustling business district and when to let us discover the amazing nightlife of Cape Town on our own. I want to personally thank Thando, who grew up in Durban, for helping us see so many nuances of South African life I think we would have otherwise missed.

These organizers were so good at their task of bringing us together that they needn’t bother about organizing a reunion for us to relive our South Africa glories. As you can tell, that will happen spontaneously.

–Abheek Bhattacharya ’18

Searching for South Africa’s Entrepreneurs

After the impossibly beautiful nestled-between-the-sea-and-hills views of Cape Town and the primordial right-out-of-Planet-Earth feel of our Kruger Park safaris, Chazen South Africa landed at our final destination earlier this week: the commercial capital of South Africa, Johannesburg.

IMG_3115.jpgJohannesburg was built from scratch around neighboring gold mines—unlike the other big commercial cities of the globe, it has no natural advantages such as river or sea access—so it was fitting that the question occupying us during our business visits here was how new businesses in South Africa can similarly be built from scratch. That is, what exactly is the state of South African entrepreneurship?

We visited a man called Sizwe Nxasana, perhaps one of the most inspirational business leaders any of us have met. Sizwe was one of the first six black accountants in apartheid South Africa. Considering all the odds against black businessmen before the country became a democracy in 1994, he managed to co-found his own accounting firm in 1989 that today is the fifth largest in the country after the global Big Four auditors.

IMG_3162.jpgA born career-switcher, Sizwe then went on to become CEO of the state-run telecom company in 1998. Though he knew nothing about telecom, he understood that telecommunications would be the way to help poor blacks reach into the new century. He helped partially privatize the company, list it on public bourses, and cut its bloated staff by half. If that wasn’t enough, the restless Sizwe switched again—leading one of the nation’s largest banks. Now semi-retired, he devotes his whole time to an education nonprofit he founded Sifiso Learning Group, with the goal of improving both quality and access to education.

Are there lessons from Sizwe’s own story? He humbly says he just happened to be at the right place in the right time, one of the few black South Africans with a business background who could help Nelson Mandela’s post-apartheid state rebuild. But he is worried that entrepreneurs across South Africa are today getting squeezed by the triple pincers of Big Government, Big Business and Big Labor.

The government highly regulates many parts of the economy—in education, for instance, there are lots of mandates about what can be taught, and even rules governing the hours of the school day. Meanwhile, the budget deficit is worryingly rising, sucking capital that could otherwise be deployed to the private sector.

As for Big Business, they probably like the rules that erect barriers for newcomers. Lastly, unions throw up problems for hiring. Teacher unions are some of the most vocal opponents of the education reform Sizwe and others want, for example. At this rate, it’s difficult for South African entrepreneurs to break out.

The good news is that it is possible for a homegrown South African business to become a powerful global brand. To witness that, we visited Nando’s, the casual dining chain famous for its spicy Mozambican chicken.

Nando’s was started by two South African entrepreneurs in the late 1980s, and grew because of its tasty product (which is a local staple in neighboring Mozambique); its impeccable quality control of its chillies from local farmers; and a plucky brand that gets attention through provocative advertising campaigns. Nando’s isn’t that big in the U.S. yet (there are just 40 locations), but it’s become a cultural staple in the U.K., and is growing quickly in the Middle East and India.

98C5D308-A10A-402D-8E8A-C26F63BBF12D.jpgEntrepreneurship is hard in most parts of the world. But it’s even more so in South Africa, given the pressures governments, big businessmen and unions apply. Perhaps the consolation here is that the entrepreneurs who do make it have to have such velocity to escape the harsh gravity of this economy, that they truly zoom onto the world stage.

~Abheek Bhattacharya ’18

Safari Times in South Africa

From Cape Town, Chazen South Africa made its way to Kruger Park and its glorious five million acres of forest reserves last weekend. We went on not one, but two safari treks over two days.

IMG_2991.jpgThe more serious highlights were:

  • Witnessing four of the “Big Five” game animals, so called because if you attack them, they will attack back:
    • Wild buffalos, the most unpredictable of these five. Thankfully, we saw them from afar.
    • A lion, lazy and imperious.
    • Many elephants, one too close to our safari jeep for comfort.
    • And, despite all the species’s surreptitiousness, some of us managed two sightings of leopards. In one of these, the big cat was cooling itself on the branch of a tree.
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  • The only one of the Big Five we didn’t get to see: the rhino.
    • That’s no surprise given the horrific increase in rhino poaching that’s occurred across the continent since 2008. The reason? Chinese and Vietnamese households either desire the powder of the rhino horn (for bizarre medical reasons) or the horn itself as a symbol of wealth and status. The rhino is now shockingly endangered in South Africa.
    • We attended an excellent lecture on rhino conservation, where we heard all the myriad ways South Africa has tried to stave off poachers but failed. I personally came away with the conclusion that the one path South Africa hasn’t taken may be the best shot—and that is, to legalize the trade of rhino horns. This might paradoxically help save the rhino. It will help officials flood the market with their own stockpile of rhino horns, thereby driving the global price down, and also allow them to tightly regulate activities.

The less serious highlights were:

  • Our spot-on safari wear, some of it hastily acquired in Cape Town to fit the occasion. Shout-outs to Patrick Yee ’19 and Ankit Chadha ’19 for being especially spot on.

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  • Dinner in the bush—in a small enclosure in the forest—where we ate some finger-licking sausages made from the kudu (an antelope), and rang in a trip member’s 30th
  • Those few occasions when we witnessed the, ahem, “fifth leg” of these quadrupeds.
  • That one time one of us (who will go unnamed) thought that the leopard the rest of us spotted on a tree was lying on the ground. Alas, he was looking at a rock.
  • All those times some of us (including this writer) squealed on seeing a game animal.
  • All the times the men of Chazen South Africa ’18 flirted with the stunning female safari tour guide, but never managed to get her number.

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All in all, it was an epic safari trip. In fact, to borrow a phrase from one of the most vivacious members of our entourage, nothing Chazen South Africa ’18 did wasn’t epic.

~Abheek Bhattacharya ’18

South Africa: The State of Trust

Chazen South Africa’s first four days were full of side-splitting laughter and rib-tickling fun in Cape Town. We climbed the 1,100-meter high Table Mountain, wined and dined (and drummed away at an African restaurant), and rang in two birthdays.

IMG_2856.jpgBut in a land of poverty and inequality, we were presented with much to ponder over, too. The common thread we observed in our visits is that of trust—trust in public institutions and, more generally, trust in other South Africans.

At its infamous prison in Robben Island, the apartheid regime broke a black South African’s trust in his white countryman for decades. Prisoners worked nonstop in limestone quarries under the blinding sun without any sunglasses, permanently impairing eyesight. They could barely speak with their loved ones, or be brought news of the outside world. And a top political prisoner was tortured by purposely being brought outside news—and prevented from sharing the news with anyone else.

We visited two e-commerce firms in South Africa—TakeALot, the Amazon.com the country, as well as Yuppie Chef, a niche kitchen-appliance vendor—both of whom talked about how the online market in the country is still so small. Despite being compared to other large emerging markets such as China or India, South African e-commerce is barely 1% of total retail sales, whereas China’s is nearly 20% and India’s in the high single digits.

IMG_2823.jpgOne reason: A history of banking fraud in South Africa has slowed development of online payments. Those who follow the explosive growth of e-commerce in Asia will know how significant a role Alibaba’s own payment service played in creating trust in e-commerce across China. Called AliPay, that service keeps customer money in an escrow account that won’t be forwarded to the merchant until the customer was happy with the product.

We also visited a financial planning startup in Cape Town called 22seven, akin to Mint.com or Betterment in the U.S. Part of a financial conglomerate called Old Mutual, 22seven’s mobile app is still getting its feet off the ground when it comes to growing its user base. South Africans need to be coaxed to enter their financial details on a mobile app.

IMG_2815.jpgOften, the mistrust is directly aimed at the public provision of goods that we in the West take for granted. At Township Farmers, we saw a social enterprise try to kill two birds with one stone—a daycare center for children under 6 years of age who might otherwise fall prey to the worst in society, and an organic farm in the backyard of that center that teaches children about agriculture. The children are happiest around the garden, while the farm piggy-backs on the infrastructure, especially the water, of the daycare center. One depends on the other, because the provision of education and water is otherwise so poor.

All this said, South Africans are a technically accomplished and entrepreneurial bunch, and are making strides. Online payments now require a user to key in a PIN using a mobile device, which should foster trust. Yuppie Chef goes out of its way to write handwritten cards to new consumers who buy appliances off its website, creating a bond to both the brand and to the otherwise impersonal edifice of e-commerce. Township Farmer’s very existence is proof of risk takers looking for roundabouts.

In other words, this is the hard slog of building brands and institutions—and new mindsets. Like in other emerging markets, perhaps what one needs most is patience. As one of our tour guides observed when we were waiting for an hour for a meal: We in the West may have a (wrist) watch, but in South Africa they have the time.

~Abheek Bhattacharya ’18

Bless CBS Down in South Africa

Travel is supposed to make the world feel smaller. But on the eve of our Chazen trip to South Africa, the feeling among the 30 of us is probably of the size and expanse of our coming excursion.

Over the next 10-odd days, we will try to familiarize ourselves with the history, culture and economy of the fifth largest country in Africa by population. We’ll visit 10 companies, ranging from a firm that makes explosives for mining to a nonprofit that teaches agriculture to children.

We will hike to Table Mountain in Cape Town and bask in the impossibly beautiful views of a city often sandwiched between the sea and the hills. We’ll go to Apartheid Museum in Johannesburg to learn about the one of the most notorious regimes of postwar history, and also to Robben Island in Cape Town—where Nelson Mandela was imprisoned for many years—to appreciate the great man who fought that regime. And we’ll ride on a safari through the world-famous Kruger National Park and its 5 million acres.

There is a lot to take in, and the excitement that precedes any big trip is this time mixed with some fear—at least for me. Thankfully, our trip is ably led by Thando Mtshali ’18, Divya Raj ’18 and Maria Sebastian ’18, and under the watchful eye of Prof. Elizabeth Webb.

So eager were we CBS-ers that some of us got to Cape Town a few nights before the official start of the trip. I am already in awe of the city’s beautiful mountains and beaches, as well as its vibrant restaurants and nightlife. Plus, we got to ring in the New Year here in style, some of us in a little more style than the others…

I’m looking forward to sharing more of our adventures over the next 10 days.

~Abheek Bhattacharya ’18